Parties to a futures contract can ________ their position by taking an offsetting position in the same contract. For the ________ of a futures contract, this means selling the same number of identical futures contracts; for the ________ of a futures contract, this means buying the same number of identical futures contracts.

Question

Quizplus · Accepted Answer

Parties to a futures contract can liquidate their position by taking an offsetting position in the same contract. For the seller of a futures contract, this means selling the same number of identical futures contracts; for the buyer of a futures contract, this means buying the same number of identical futures contracts. Therefore, only choice C correctly matches the actions taken by the parties with their respective positions in the futures contract.

Parties to a Futures Contract Can ________ Their Position by Taking